0. Commercial Arbitration in the ECO Region
Regional Arbitration Centres:
A Practitioner View
Catriona Nicol
1 December 2014

1. Regional arbitration centres
Key international arbitration institutes – LCIA, ICC (most commonly used)
But increasing number of regional and specialist institutions in existence. In Iran:
Arbitration Centre of the Iran Chamber (established 2002)
Tehran Regional Arbitration Centre (commenced activities in 2005) (3 cases in 2009; 3 cases in 2010)
Significant increase in recent years:
Before 1940, only 10% of institutions around today existed
70% created in last 30 years
50% created in last 20 years
20% created in last 10 years
Middle East has increased from one arbitration centre in early 1990s to over 90 listed on Arab arbitration list
Greater choice for arbitrating parties means greater competition for institutions

2. What makes a successful institution?
Key factors:
Arbitral institution rules
National arbitration laws
Approach of national courts
Personnel, facilities and infrastructure – institutional and jurisdiction
Survey carried out in 2010 listed key factors as including:
Neutrality/”internationalism”
Reputation/recognition
Previous experience of institution

3. Arbitral institution rules
First and foremost – arbitral institution rules need to meet the needs of the parties
Must address:
Standard requirements – processes applicable to arbitration, appointment of arbitrators, challenges to arbitrators
Also include provisions on emergency arbitrators, expedited arbitrations, multi-party and multi-contract
Responsive to changes in legislation, regional/international trends, requirements of parties, progress of other institutions (ie, see series of changes to rules of existing institutions)

4. National laws and courts
Arbitration does not exist in a vacuum – method of dispute resolution that functions within a legal system
Impossible to exclude operation of national laws and national courts entirely – even UNCITRAL Model Law and New York Convention recognise that they have a role to play
What is that role?
Ideal relationship – arbitration operating free from “controls of parochial national laws and without the review and interference of national courts”
Nightmare relationship – undue and damaging court and law intervention
Most practical solution – court support (in between the two)

5. National laws
Successful regional arbitration centre requires an arbitration-friendly legal environment
National arbitration law based on UNCITRAL Model Law
Accession to New York Convention
Allow for limited intervention before and during arbitral process:
Intervention only where required by parties and in support of the arbitration
Involvement after conclusion of arbitration – limited grounds to challenge/set aside arbitration award
Supportive government is crucial – successful centre requires constant evaluation and examination of the arbitration law to ensure that the law addresses the needs of the parties and processes are in place to support arbitration (see the growth of Singapore)

6. National courts
National laws dependent on interpretation and application by national courts
Without supportive national courts, parties will not even consider a regional arbitration centre
Courts should adopt policy of limited and careful intervention
Intervention only where in support of arbitration and where requested by parties
Judges:
Familiarity with arbitration matters
Respect for arbitration process
Highly skilled and respected
Neutral and independent

7. Arbitrators, personnel and institutions
Experienced and respected arbitrators essential
What makes a good arbitrator?
How to attract good/experienced arbitrators?
Availability of other personnel – bilingual lawyers, experts, translators, court reports, institution staff
Institution
Experienced staff (administrators and case handlers)
Importance for ensuring there is no timetable slippage (large scale arbitrations sometimes criticised for speed of resolution/delay/expense)
Willingness/ability to organise conferences/seminars to raise awareness of arbitration and institution (both regionally and internationally – marketing)

8. Facilities/infrastructure
Facilities for arbitrations and parties:
Purpose built facilities for arbitral institution? Meeting rooms/hearing venues/technology
Hotel/conference facilities – not only arbitrators and parties, but also witnesses, lawyers, experts, other staff?
Infrastructure:
Transport links/accommodation facilities
Safety and political stability

9. Examples – successful institutions
SIAC (Singapore International Arbitration Centre)
Formed in 1981
Caseload has tripled in last ten years
Government is extremely responsive and has the ability to update and improve legislation in a matter of months
Courts have contributed by being supportive of arbitration, upholding the finality of awards and keeping intervention to a minimum.
Capable and professional Secretariat
Rules have kept pace with developments in international arbitration (5th edition released in 2013, with major changes also promulgated in 2007 and 2010)
2005
2006
2007
2008
2009
2010
2011
2012
2013 74 90 86 99
160
198
188
235
259

10. Examples – successful institutions
Kuala Lumpur Regional Centre for Arbitration (KLRCA)
Formed in 1978
Before 2011, it was handling around 20 cases a year; in 2013, it oversaw 156 cases and in 2014, over 230
Malaysia amended its Arbitration Act in 2005, which was then updated with the Arbitration (Amendment) Act in 2011.
One key selling point – affordability - KLRCA’s rules were amended last year to ensure that its fees are 20 percent lower than the likes of SIAC and HKIAC
Also note liberalisation of Malaysia’s legal industry – allows foreign lawyers to appear in arbitrations and exempts foreign arbitrators from paying withholding tax on the fees earned.
Also introduced its i-Arbitration Rules, which deal with the arbitration of disputes arising from commercial transactions premised on Islamic principles